Medicaid is a joint federal-state program. As such, payments are made by both the federal government and the state government.

Bonnie Kraham

Medicaid is a joint federal-state program. As such, payments are made by both the federal government and the state government.

However, that simple dichotomy can be deceiving, because it lumps the actual state government with the local governmental entities (like counties). Each state can operate differently, but in New York, the "state" portion of the bill is actually divided between the government in Albany and local governments.

The payment system has led to much controversy in recent years, mostly as counties have struggled to keep up with their obligations.

The New York Medicaid system is the largest in the country, and comes with significant costs. Many county officials have argued that it is becoming impossible for the local governments to keep up with costs, particularly as those costs have risen.

Some counties are going to significant lengths to cut Medicaid obligations. For example, Oneida County is trying to recoup Medicaid payments that it believes were above its obligations. The county argues New York state owes it between $4 million and $6 million. The discrepancy allegedly stems from overpayments made by the county for in-house care for those with mental illnesses.

Little information exists on the merits of Oneida County's claims or the likelihood of success in its effort to be reimbursed by the state. Regardless of the outcome in this particular state-county dispute, most observers believe big changes are in the works for New York Medicaid payment arrangements.

In particular, all of the county portion of Medicaid is likely to be taken over by the state. This will relieve counties of the burden of paying a portion of the costs, generally through property taxes. A gradual takeover was already approved, which should transfer the counties' "3 percent" portion to the state.

Assemblyman Joseph M. Giglio, R-Gowanda, a member of the state's Medicaid Redesign Team, summarized the situation as follows: "New York recently phased in a gradual takeover of the 3 percent local share of Medicaid costs, but I believe that more must be done to bring down costs for local property taxpayers. Counties have no control over the rules or eligibility for Medicaid, but county taxpayers are stuck paying for a significant portion of the cost. This must end."

On top of that shift, many lawmakers are still urging changes to the system in order to make it more viable in the long term. Those changes might include even more aggressive approaches to save on overspending. Changes to eligibility or other rules might also be in the works down the line.

Bonnie Kraham is an attorney practicing elder law estate planning with the Ettinger Law Firm, 75 Crystal Run Road, Town of Wallkill. She can be reached at 692-8700, ext. 119 or at bkraham@trustlaw.com. This column is intended to provide general information, not legal advice.